AutoZone 2010 Annual Report Download - page 31

(xxii) economic value goals (including economic value added);
(xxiii) customer retention;
(xxiv) sales or sales-related goals (including sales per square foot and comparable store sales);
(xxv) earnings before interest and taxes margin; and
(xxvi) return on inventory
any of which may be measured either in absolute terms or as compared to any incremental increase or
decrease or as compared to results of a peer group or to market performance indicators or indices. The Plan
also permits the Administrator to provide for objectively determinable adjustments to the applicable
performance criteria in setting performance goals for QPBC awards.
How does vesting of awards occur under the Plan?
The award agreement governing an award under the Plan will specify when the right to exercise the
award will vest, in whole or in part, and will denote any events or conditions upon which vesting is contingent
or which may accelerate vesting.
At the time an award is granted or at any time after such grant, the Administrator may specify events,
including a change in control, that will accelerate the vesting or exercise date of all or part of the award.
Are awards under the Plan transferable?
With limited exceptions for estate planning, domestic relations orders, certain beneficiary designations
and the laws of descent and distribution, awards under the Plan are generally nontransferable prior to vesting
and are exercisable only by the participant.
How are tax withholding and payment obligations handled under the Plan?
With regard to tax withholding, exercise price and purchase price obligations arising in connection with
awards under the Plan, the Administrator may, in its discretion, accept cash or check, shares of our common
stock that meet specified conditions, a “market sell order” or such other consideration as it deems suitable.
What happens in the event of corporate transactions affecting the stock?
The Administrator has broad discretion to equitably adjust the provisions of the Plan, as well as the terms
and conditions of existing and future awards, to prevent the dilution or enlargement of intended benefits and
facilitate necessary or desirable changes in the event of certain transactions and events affecting our common
stock, such as stock dividends, stock splits, mergers, acquisitions, consolidations and other corporate transac-
tions. In addition, in the event of certain non-reciprocal transactions with our stockholders known as “equity
restructurings,” the Administrator will make equitable adjustments to the Plan and outstanding awards. In the
event of a change in control of AutoZone (as defined in the Plan), the surviving entity must assume
outstanding awards or substitute economically equivalent awards for such outstanding awards; however, if the
surviving entity declines to assume or substitute for some or all outstanding awards, then all such awards will
vest in full and be deemed exercised (as applicable) upon the transaction. Individual award agreements may
provide for additional accelerated vesting and payment provisions if the Administrator so determines.
Can the Plan be amended or terminated?
The Board may terminate, amend, or modify the Plan at any time; however, except to the extent permitted
by the Plan in connection with certain changes in capital structure, stockholder approval will be obtained for
any amendment to (i) increase the number of shares available under the Plan under either or both share limits,
(ii) reduce the per share exercise price of the shares subject to any option or stock appreciation right below the
per share exercise price as of the date the option or stock appreciation right was granted, and (iii) cancel any
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